UK economic totalled 0.5% during the first quarter of 2019, according to the latest figures from the Office for National Statistics (ONS). This represents an increase from 0.2% recorded in the fourth quarter.

The economy was buoyed by the services sector, which exhibited the strongest growth during the three-month period.

The UK’s manufacturing sector also positively surprised, growing at its fastest rate since 1988. However, the ONS pointed out that this may be down to manufacturers facing increased demand to fulfil orders before the original Brexit deadline in late March.

In spite of the Brexit uncertainty, which continues to loom, business investment increased during the first quarter.

EU weakness bites

Phil Smeaton, chief investment officer at Sanlam, pointed to the irony that economic weakness in the European Union (EU), driven by declining industrial activity in Italy and Germany, may be acting as a drag on UK growth.

“As global trade disputes rumble on it would seem that any hopes of stronger EU growth lie with domestic activity, which would provide a welcome boost for the UK,” he added.

Smeaton was also encouraged to see that jobs are still being created and wage growth remains strong within the UK.

Ian Forrest, investment research analyst at The Share Centre, added: “While it is good to see the economy growing despite all the uncertainty around at present the market is still conscious of the hawkish comments made by the Bank of England’s Monetary Policy Committee at its latest meeting when Mark Carney said he expected interest rates to rise more than the markets were anticipating.”

At 11:35, the FTSE 100 index was up 0.45% at 7,240 points.